The Hottest Real Estate Markets in America, March 2018

The impact of two long years of declining numbers of homes available for sale is readily apparent as this year’s go-go spring buying season gets started in earnest. The proof: A crowd of home buyers—including many who’ve missed out in previous seasons—is driving prices to record heights, according to a preliminary analysis of realtor.com® data for the month.

Talk about March madness!

“Never in history have there been more eyes on fewer homes than today,” said Javier Vivas, director of economic research at realtor.com. “The price gains observed in the last days of March tell us the market is on pace to see half of the homes listed above $300,000 this summer. This means buyers are not just having to pay more for the same home—they’re also seeing the mix of what’s available change more rapidly.”

Listing prices have already overtaken last summer’s high: $275,000 in July 2017. The median listing price for March is $280,000, the highest point since realtor.com began its monthly analysis of inventory data in early 2012. That’s also an 8% increase over March 2017.

There was just a small increase in housing inventory, which grew 3% from February to March. However, the total is still down 8% from March 207. The influx of 480,000 new listings won’t be enough to bring relief to buyers—it’s 14% higher than the previous month, but 1% lower than last year.

Plus, the new listings disproportionately favor higher-income buyers. Vivas said his team recorded a healthy injection of new listings above $350,000, while the number of new listings in the $200,000-$350,000 range was anemic. And below $200,000? Pretty much nonexistent.

“This bodes well for buyers in the upper and luxury tiers as they see more options surface, but paints a darker picture for the entry-level market,” noted Vivas. “If this pattern holds, 1 in 12 listings nationally will be listed above $1 million this summer, while only 1 in 3 will be listed under the $200,000 sweet spot targeted by half of all buyers.”

Among the largest 100 markets in the country, 36 are still seeing homes sell at least a week faster than this time last year. This includes colder weather markets, which are thawing faster than expected and quickly catching up to the rest of the country.

“Nationally, homes are still moving faster than last March, but more critically, supply in the market is carrying baggage from even larger drops in the last two spring home-buying cycles,” Vivas said. “The cumulative effect means it will be a languid search for most home buyers this season as they face the most competitive, harshest conditions yet.”

Whew! Want to know which markets are the most cutthroat? Our hot list shows the metropolitan centers where homes get the most listing views on our site and spend the fewest days on the market.

This month, tech-fueled San Francisco again held onto the No. 1 spot. Buffalo, NY, jumped 17 spots to break into the top 20 for only the second time since realtor.com began tracking this data in 2013. The previous time was June 2015.

The next biggest mover was Boston, which ascended 14 spots. Note that when we talk about metropolitan markets, they often encompass other towns and suburbs. The Boston metro, for example, includes neighboring Cambridge and suburban Newton, as well as part of New Hampshire.

While California dominated the list as usual with 11 markets, eight other states were represented: Colorado, Texas, Massachusetts, New Hampshire, Ohio, Idaho, New York, and Michigan.